Article 420-7 of the French General Chart of Accounts authorises companies to record their foreign currency transactions in an account specifically dedicated to foreign currency transactions.
This foreign currency account is freely managed by the company but must necessarily be converted at the end of the financial year.
The conversion of the various amounts recorded can be done in two different ways:
- Immediate conversion: based on the exchange rate of the day of the transaction or based on the fixed or average rate.
- Conversion at the end of the financial year: via liaison accounts that allow currencies to be linked.
The recording of foreign currency transactions in a separate account therefore facilitates the management and organisation of your accounting. In fact, the company will only have to convert the sums, either directly or at the end of its accounting year.
Avoid exchange rate losses with DeftHedge
Good accounting management is an essential element for any company, especially when you have to carry out foreign exchange transactions. Indeed, when you are on an international market, you are confronted with exchange rate risks.
If the evolution of the exchange rate is to your disadvantage, the results of your various foreign currency transactions can be strongly impacted. In order to minimise exchange rate losses, you can therefore use DeftHedge’s SaaS solution, specially designed for companies carrying out foreign exchange transactions.
With our currency management solution, you will be able to automate many accounting tasks and focus on the best strategy for your international operations.
Our management tool allows you to be perfectly informed about your accounting and offers you the possibility to simulate different strategies in order to choose the most interesting one. Thanks to the extensive information available on DeftHedge, you will be able to considerably improve your strategy and reduce your foreign exchange losses.
On a daily basis, our SaaS solution will become indispensable in the management of your company.
